West End retailers are hoping a bumper Christmas will help to offset a challenging year, as international shoppers continue to flock to the UK to take advantage of the weak pound.
Sales in the six weeks leading up to Christmas are expected to rise 1.6% year on year to £2.34bn and stores on Oxford Street, Regent Street and Bond Street will take an average of £51.1m per day, according to the New West End Company’s annual Christmas Tracker report.
Retailers will be hoping to cash in on the increased number of tourists, particularly from China, Saudi Arabia and the US. The average spend per tourist reached £1,155 in September, according to research from tax-free shopping services company Global Blue.
“We’ve seen a lot more visitors from the EU and beyond and we’ve every reason to believe that will continue,” said Eleanor Dalley, general manager of House of Fraser Oxford Street.
Fenwick of Bond Street’s buying and merchandising manager Adam Kelly said he was expected to see a 40-45% increase in sales at the department store’s Christmas shop, helped by Christmas Day falling on a weekend.
“The timing of Christmas means two bank holidays in the following week for people to shop with their Christmas money.”
However, the tracker warned domestic consumers might be reluctant to splash out after a tumultuous year, and said overall footfall in the West End is predicted to decrease by 3.1% year-on-year as more consumers do their Christmas shopping online.
Paul Lorraine, UK general manager of accessories label Longchamp, said 2016 had been a year of two halves for many West End retailers.
“Consumer confidence was low, domestic spend was flat and the tourists weren’t coming during the first half of the year. But after the EU referendum, business changed. In the first couple of weeks after Brexit we joked that tourists thought they couldn’t get in to the UK but since then we’ve seen 18, coming up to 19, weeks of continued growth in luxury.
”That said, we enter 2017 with a little bit of caution. A deal with Europe will have to be found but we don’t know what that will look like. We also have different concerns for the first half of 2017, like business rates, whether the pound will remain weak and inflation.”
New West End Company chief executive Jace Tyrrell acknowledged that many retailers in the area face dramatically increased rates bills, but argued that Crossrail and the extension of the night tube would help drive more shoppers into central London.